Tesla gets crushed by the big boys.

Total new-vehicle sales in the US fell 5.2% year-over-year in December to 1.6 million units. For all of 2017, sales declined by 320,000 vehicles, or 1.8%, to 17.23 million units. It was the first overall decline since the Financial Crisis.

Compared to 2015, sales fell by 249,033 vehicles, or 1.4%. These sales are vehicles delivered by dealers to their customers, or delivered by automakers directly to large fleet customers, as reported by Autodata.

For the big three US automakers and some import brands it was the second year in a row of sales declines (two-year percent change from 2015):

GM -2.7%

Ford -1.1%

Fiat Chrysler (FCA) -8.6%

Toyota -2.6%

BMW -12.6%

Mazda -9.3%

The table below shows new-vehicle sales by automaker, sorted by total sales in 2017 (gray column). Automakers with declining sales in 2017 are marked in red. The green column shows the two-year percentage change from 2015:

It was expected to be a bad quarter for General Motors. It ended up being abysmal.

GM reported that July auto sales crashed by a whopping 15%, nearly double Wall Street’s already depressed expectations of a 8% drop, and with GM mothballing production across the country to catch up with lagging demand, it still sold only 226,107 vehicles as a result of double digits drops in Chevy, Build and Cadillac Sales of 15.3%, -30.5% and -21.7%, respectively. The only “good” performer was GMC, which dropped by “only” 7.3% Y/Y.

You can’t say we weren’t warned. As reported over a month ago, before the surprising rebound in April retail sales, the biggest drag on consumer spending was auto sales. One month later, this is finally starting to materialize when earlier today, both GM and Ford’s US vehicle sales fell more than analysts had estimated in May. According to Bloomberg this “raises questions about stalling consumer demand.” Not really: as we also warned a month ago when looking at stalling use car price changes, it was only a matter of time before the lack of demand for every low priced autos spilled over to new car sales, which it now has.

When bailout-darling GM ‘fessed up to an intentional ignition-switch defect, tied to at least 174 deaths, The Justice Department fined them $900 million (and no employees faced criminal charges). So, in this consequence-less world in which we live, when Volkswagen admits to literally cheating emissions-standards tests, it faces up to $18 billion in fines from The EPA, one has to wonder whether “we” have our priorities right?

Doubting if the growth ahead of GM is now over, and the great post-bankruptcy “success story” is rapidly fading as the company has been pushed to resort to the kind of financial engineering which has pushed the S&P higher for all of 2014, and follows a record month of stock buyback announcements? Then doubt no more: moments ago GM announced it is authorizing an immediate $5 billion stock buyback, and plans to return all cash above a $20 billion floor to shareholders.

One could say things about what is now without doubt the biggest company joke in the history of the US – maybe global – automotive sector, putting even East Germany’s infamous Trabant to shame.

Things like following the just announced latest recall of another 7.6 million cars across models from 1997 to 2014, and another 800K+ cars thrown in just because, GM has recalled more cars in the first 6 months of 2014 than it has sold in all of 2011, 2012 and 2013. Which incidentally would be true as the chart below shows.

Things like it took GM over a decade to that these latest recalls affecting cars made in the 20th century resulted in “seven crashes, eight injuries and three fatalities.”

Back in 2011 Goldman, when the FDIC-insured bank holding company with no deposits, was slapped with the biggest at the time SEC penalty for shorting CDOs it had sold to clients, it started a trend of scapegoating all its evils on a lone, then 20-something individual, Fabrice Tourre, who seemingly had “worked alone” and whose actions were not supervised by anyone: the chain of responsibility started and ended with him. Naturally, nobody went to jail. A few years later, stuck in the biggest scandal of its post-bankruppcy existence involving over 20 million recalls in just the first 6 months of 2014 alone, GM has decided that what worked for Goldman should work for it too, and as the WSJ reports, is “pinning of a decadelong failure to recall defective cars on a lone engineer.”

Unfortunately for GM, an organization that is far more politically charged than Goldman, it is “running into skepticism from lawmakers who say GM documents show dozens of people were alerted to ignition-switch defects during the past decade.”

But before we get into the details of what is set to be even more political theater, just who is this lone engineer?

Instead of “defective”, GM suggests its employees use the phrase “does not perform to design” according to just released documents in the GM recall probe. However, the internal presentation provides a glimpse into the internal thinking at GM as it suggests the following 69 words should not be used in a company memo… including “Hindenburg”, “spontaneous combustion”, and “Kevorkianesque.”

Over the weekend we titled our summary of GM’s unprecedented avalanche of recalls so far in 2014 – the year in which the company’s criminal practice of covering up its faulty products became a congressional scandal – as follows: “GM Set To Surpass Total Recall Record This Year.” Three days later we are happy to report that while Detroit, we not only have a big recall problem, we also have a new record, after moments ago GM just announced another 4 recalls affecting 2.4 million cars.

This brings the total number of vehicle investigations since the start of the year to 35, and with today’s four latest fiascos, has initiated a whopping 29 recalls. More importantly, this also means that the number of domestic recalls rises to 13.6 million, smashing the previous record of 11.8 million recalls in 2004, and brings the number of global recalls to 15.2 million: or a stunning 56% greater than the 9.7 million cars GM sold in all of 2013!…

“GM now wants bankruptcy protection from any of their vehicles from before 2009…….pay nothing, dump it all on the people. The courts will probably go along with it, they are corporate owned and corrupt.”

Car giant wants court to shield ‘new GM’ from legal claims for problems with its cars that occurred before its 2009 bankruptcy

GM has said at least 13 deaths have been linked to the switch problem. Photograph: Stan Honda/AFP/Getty Images

General Motors revealed in court filings late Tuesday that it will soon ask a federal bankruptcy judge to shield the company from legal claims for conduct that occurred before its 2009 bankruptcy.

The automaker’s strategy is in a motion filed in a Corpus Christi, Texas, federal court case, and in other cases across the nation that involve the defective ignition switches that have led GM to recall 2.6 million small cars.

General Motors is in trouble. On the heels of a 1.3 million car recall over fault ignition switches (that allegedly caused 12 deaths and could have been fixed with a $1 part), the bailed-out car maker has announced it will take a $300 million charge in Q1 to cover costs associated with this and 3 new recalls covering an additional 1.5 million cars. As Reuters reports, unsold vehicles will be placed on a stop-delivery until development of a solution has been completed. Why is this such a problem? Because GM’s channel-stuffed dealer inventory is already at all-time record highs as the entire industry projected the sales to continue ad infinitum and inventory-to-sales surged to near-record highs.

The spin does not get any better than this… As they reported they would,

*LEW SAYS U.S. SOLD ALL REMAINING SHARES OF GENERAL MOTORS RECOUPING $39 BLN OF ORIGINAL GM INVESTMENT

That is a $10.5 Billion loss! But, The Center for Automotive Research, a Michigan nonprofit organization that analyzes auto industry issues, those funds “saved or avoided the loss of $105.3 billion in transfer payments and the loss of personal and social insurance tax collections — or 768% of the net investment.”

And The White House…

Efforts Saved Jobs, Helped Stabilize Economy During Financial Crisis

WASHINGTON – As the Troubled Asset Relief Program (TARP) continues to wind down, the U.S. Department of the Treasury today announced that it has sold all of the remaining shares of General Motors (GM) common stock.

“The President’s leadership in responding to the financial crisis helped stabilize the auto industry, and prevent another Great Depression. With the final sale of GM stock, this important chapter in our nation’s history is now closed,” said Treasury Secretary Jacob J. Lew. “The President understood that inaction could have cost the broader economy more than one million jobs, billions in lost personal savings, and significantly reduced economic production. As a result of his efforts, which built on those of the previous Administration, more than 370,000 new auto jobs have been created, and all three U.S. automakers are profitable, competitive, and growing.”

When the S&P, always so conveniently ahead of the curve, yesterday revised its forecast for Europefrom growth in the second half of 2013 to 2014 one couldn’t help but golf clap, as well as wonder if they finally started looking at the fundamental depressionary reality on the ground instead of the rating agency’s infamous “models.” A depressionary reality confirmed by the latest car sales number for May which just hit a fresh 20 year low.

In what should not come as a major surprise to anyone, GM just announced that:

GM SAYS LOSING MONEY ON EVERY VOLT SOLD

There is good news: being implicitly funded by the US taxpayer means never admitting failure. In fact, the faster one fails, the faster one gets bailed out.

GM SAYS NOT GIVING UP ON VOLT

And when failure is not an option, the only other option is even greater failure. And even bigger losses.

GM SAYS NEXT GEN VOLT WILL BE $7,000 TO $10,000 CHEAPER

Slowly but surely everyone is figuring out that in the USSA, where making a profit is becoming increasingly impossible, the only credible business model is that of Amazon: lose lots of money but make up for it in volume.